TeachMeFinance.com - explain Foreign exchange loan
Foreign exchange loan -- When a loan of foreign exchange
is made exchange is loaned; the money represented by the
exchange is not loaned, but a bill of exchange is loaned. If
the borrower has an obligation that is payable at home he may
use the bill in meeting it or he may sell the bill and use
instead the money received for it. If the obligation is payable
abroad he presumably will forward the bill in payment of it.
Collateral (security) may be and generally is deposited with
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